Do smaller organizations need performance plans?

At some point in the growth of a small business, you can’t just rely on that “intuitive” process of people working together towards a common goal. The reality is – as you grow and evolve, it becomes important to put enough structure and processes in place to ensure success. But that doesn’t mean you have to do it the same way as larger corporations!

As a small business, you probably want to stay agile and adaptive. You want your employees to remain engaged, and to have positive relationships with customers and stakeholders. So consider, how can you:

  • Make sure that you are using your resources most effectively?
  • Let employees know exactly what is expected of them?
  • Monitor performance and productivity, and catch problems early?

Larger corporations may use Performance Management Systems. These may not be suitable for smaller business for several reasons:

  • Can be expensive, complex and onerous to implement
  • Require a structured approach with limited (or no) flexibility
  • Focus on the tool rather than skill development and interaction between employee and supervisor

The Solution: The OMM Performance Plan Approach

I have distilled the essential components of Best Practices in Performance Management to create a simplified approach that can be implemented quickly, without expensive systems.

To summarize, OMM focuses largely on developing a performance plan between supervisors and their team. The manager sets goals for the work unit and may engage teams in discussions about suitable performance measures. But ultimately, each employee defines HOW they will support the work unit goals. This is where the magic can happen – by encouraging employees to leverage their unique strengths, and by building their accountability to the work team.

The framework is based on two very simple templates:

  1. A Work Group OMM – performance plan developed by the Manager (supervisor or team leader)
  2. An Individual OMM – performance plan for each employee

In addition to performance measures, the plan also includes an agreement on how employees will keep their supervisor and others. This will involve a commitment for each employee to do some regular self evaluation based on their performance measures.

But unlike other performance frameworks and systems – we don’t get caught up in performance management terminology. And this process is flexible to allow for adaptation. We don’t “sweat” how to get it perfect the first time. The key to developing and implementing successful performance plans is to ensure that supervisors are trained in how to use them. This includes developing skills in both performance management AND leadership. So we will teach and support managers on how to use the tools effectively.

How OMM is implemented in Small Business

The focus of OMM is at a business unit level. That is – the relationship between a manager (supervisor or team leader) and their work team. Ultimately, it leads to a performance plan for each employee. The goal is to ensure managers provide:

  • Clear direction on the “big goals” (outcome)
  • Expectations on the results (measures)
  • How each employee will monitor their progress and keep you informed

Supervisors and Managers are guided through how to develop the Work Group OMM through online training and a specialized workbook. The training will include tips on how to set effective performance measures, and the “soft skills” for engaging employees and encouraging them to be accountable for their performance. Check out my previous article for some insights on what managers can do to improve employee performance.

Can OMM be used for team performance?

Yes, we provide examples in the workbook and training on how to use OMM to improve team performance. It can be especially helpful for geographically distributed teams to make sure that everyone is on the same page. The key is to keep you team engaged and communicating regularly to catch and solve problems early.

IS OMM for annual performance planning? Or short term?

The short answer – it can be both (and more!). I have built the templates to be flexible and provide “just enough” structure to guide performance. The simple performance plan templates are scalable. That is – they could be used for annual performance planning or even for shorter term projects. The difference will come in the types of measures (including timelines) and monitoring schedule that managers use. We cover examples of both in our training.

What about performance reviews?

The above process provides enough structure to greatly improve performance and productivity by giving employees both the accountability and the tools they need to monitor their own performance. But is that enough?

It is important that managers acknowledge and appreciate each employees contribution. And perhaps “coach” them to work out problems. Some organizations do this in an informal way. Others have more structured approaches to feedback and evaluation. To some extent – it depends on the nature of your business and the criteria you have set for advancement, bonuses, etc.

But if you are truly wanting to promote a high performing workplace, consider some of the evidence about the potential damage with traditional approaches, such as performance appraisals. I have covered some of those in a previous article regarding a better way to encourage team performance and innovation